Ecker hopeful tax increase can be avoided

February 02, 1993|By James M. Coram | James M. Coram,Staff Writer

Howard County Executive Charles I. Ecker said yesterday that he does not expect to raise taxes in July, despite an anticipated deficit of $10 million or more in the fiscal 1994 budget.

"I don't think taxes will have to be raised," Mr. Ecker said. "I hope to be able to fund the budget without an increase in taxes."

Mr. Ecker was commenting on a 10-page report prepared by a 12-member committee of businessmen and county finance officials. The report, which was released at a news briefing yesterday morning, offers spending and revenue guidelines for the coming fiscal year.

To balance the budget without raising taxes, he would have to trim some departmental requests, Mr. Ecker said.

Budget-trimming measures do not include furloughing or laying off employees, he said. The new fiscal year will begin July 1.

Although he plans to hold the line on most expenses in the coming year, Mr. Ecker intends to include money in the coming budget for new libraries in Elkridge and eastern Columbia, expand the county detention center, add new classes for police and fire recruits, and provide a new police substation.

Initial projections are for a budget $20.1 million greater than the county estimates it will spend this fiscal year. Those estimates do not include salary increases, which should be "somewhere above zero," Mr. Ecker said.

He declined to comment on what kind of sacrifice, if any, he would ask employees to make regarding their salaries this year, because his aides are in contract negotiations with one of the four employee unions. Employees were furloughed five days without pay last winter.

No matter how the question of employee raises is settled, Mr. Ecker should not even consider raising taxes unless "there is still a deficit between expected revenues and planned spending for necessary and high priority items," the committee advised him in its report.

A tax increase might cure a short-term deficit but also "may harm the longer-term economic health of the county," the committee said.

Mr. Ecker agreed with that assessment. An increase in property or local income taxes would be especially hard on business, he said, and could prompt some companies to leave the county or refuse to settle in the county. "The tax rate is very near and dear to them," he said.

Without a tax increase, "it is clear that the county will have to make difficult choices again this coming year to balance the budget," the committee told Mr. Ecker. Revenue estimates are "much more optimistic," but the county must spend "very carefully in the early going," said Joseph Raksis, the advisory committee chairman.

The advisory committee told Mr. Ecker to count on a 6 percent increase in revenues in the coming year, to result from population increases and a turnaround in the economy. The increase could grow to 10 percent if the economy improves more rapidly, the committee said.

The committee expressed concern about property tax revenues, however. "Lower assessments will mean lower growth in the residential assessable base . . . for the next few years," it said. "Commercial property values are particularly at risk."

High vacancy rates and declining rents mean that the assessed value of commercial properties will actually decline, the committee said. The committee warned Mr. Ecker to expect declines in commercial assessments over the next few years.

Although Mr. Ecker correctly predicted earlier losses of state aid, he said he believes the state will provide what it promised for the coming fiscal year. State legislators are "very cognizant of what they have done" the last two years, he said.

"I think there is a real good chance that [the amount of state aid] will not change," he said.

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